I can't fathom people arguing against the value of Game pass still! It's far and away the absolute best value in gaming, period. I have found so many new games that I would have never given the time of day it's ridiculous. Also if I really want to own one of the gp games, I buy the disc used at Gamestop when it hits bargain bin prices. It also gives publishers a risk-free option to release their games into the xbox ecosystem. Would xbox get Japanese titles like Dragon Quest and Yakuza without gamepass?! Probably not but there they are, sitting pretty on GP.
And since GP Ultimate includes Live Gold AND cloud streaming (which actually works great!) It's a no -brainer. Xbox does such a good job of adding stuff to keep it fresh that I have never once felt like there wasn't something good to play. This service has literally saved me thousands of dollars!
You're right that it is the best value, but you're comparing two products that are meant for completely different groups of gamers.
Game Pass Ultimate is great for people like you and me who want to try out many new games while also being able to play online. But you have to remember that there are plenty of people who only want to play their favorite multiplayer games like COD, Fortnite, NBA 2K etc. and don't care about trying other games even if it's a great value. XBL Gold is still cheaper than GPU, so for those people who just want to play online there's no reason to pay more for GPU if they're not going to use the extra perks.
Having more options as consumers is always better than having the company tell us which option is the better deal (of course they'll always recommend the option that benefits their own company the most) and making the decision for you basically giving you no other choice by jacking up the price for the service you might have initially preferred.